Trading is a very delicate thing to do. As delicate as taking out a thorn stuck in your foot. If you are not careful, you could end up causing some serious injury to yourself. It is not uncommon these days to find new traders wanting to have the world in the palm of their hands just a few days into trading. These absurd desires are one of the many causes of terrible mistakes in trading.
In this article, we would be sharing five common mistakes you could make as a trader. Knowing them is a great way to learn how to stay away from them too. At reviewsbird.co.uk , you would find people that have been victims of these mistakes. One thing about making mistakes in trading is that; it has an amazing yet so painful way of making the lessons of investment management thereafter stick to your head.
Below are the five common mistakes you could make as a trader:
1. Revenge trading:
This is trading driven by loss, frustration and other negative emotions that are mostly losses in the cause of trading. Revenge trading tends to steal your rationality and makes you think you can beat the system. In the long run, you end up losing more money and a lot of things you already worked hard for. When you incur losses in trading, it would do you more good to accept the loss and try to find out where you went wrong than to embark on revenge trading.
2. Big expectations:
It is not uncommon for one to find new traders who desire to get as much as one hundred pips daily. Unrealistic expectations like these fuel a frenzied and irrational trading that usually ends in losses. Mind you, we are not asking you not to set big goals. We are only asking you to be more realistic in doing so.
3. Trading without plans:
This is another terrible mistake that traders make. They fail to see that trading is not spontaneous business. It requires a lot of good planning as well as execution. Trading without a plan is just like leaving it to chance to do whatever it desires. No, that’s now good traders do. Good traders draft out trading plans that they follow while trading. Trading with a plan makes it less clumsy, more understandable and interesting. If you must become better at trading, draft your plan today.
4. Not learning to stop trading when experiencing a series of losses:
This is one mistake you can’t afford to make. When your trades begin to spiral into a seemingly infinite web of losses, it means one thing. STOP! Yes, stop with all your great ideas and plans. It is just like running a race. When you begin to run out of breath, stop and catch your breath. Don’t suffocate while trading.
5. Not keeping track of news and the market:
Trading is beyond gazing at your charts every now and then. Acquaint yourself with every single thing that happens in the news and in the market. Every fluctuation affects your own trade one way or the other. Staying on top of the news will keep you from making dumb mistakes.
Mistakes are not taboos. Some are inevitable sometimes. But the worst mistakes one can make are the avoidable ones. With these common mistakes we have shared with you, we hope you trade better and avoid making silly mistakes as much as possible in the course of your trade.